1 JANUARY - 30 SEPTEMBER volvofinans bank ab

Transcription

1 INTERIM REPORT 1 JANUARY - 30 SEPTEMBER 2010 volvofinans bank ab

2 MESSAGE FROM THE PRESIDENT Car sales continue to rise in the wake of an increasingly strong economy in Sweden. New car registrations are expected to amount to just over 285,000 units for 2010, which is now approaching earlier peaks. The signals around Volvo Cars' production target for 2011 are very positive, even where there are historically high volumes. The Chinese company, Geely's, ambitions with the acquisition of Volvo Cars has clearly emerged, with a new CEO and a highly experienced board. This has generated an optimism and positivity within the Swedish Volvo system. There is currently pressure on Swedish Volvo dealers, where deliveries to the customer of cars from these record sales is now top priority. Renault has almost doubled its sales over the previous year and Ford is also exhibiting significantly increased volumes. The Swedish Volvo dealers, with all their brands, are, therefore, doing very well in the current business climate. Added to this is a booming truck market and a Volvo Trucks division that needs to employ new staff to cope with the ever increasing demand from customers. We have, therefore, increased business volumes in recent months. The increase is influenced, not only by new but also used vehicle sales as well as sales from garages, which have been very busy. This benefits Volvofinans Bank through increased usage of the Volvo Card and the Volvo Truck Card. In addition, fuel sales have increased. The Riksbank has, predictably, continued to raise interest rates in light of the growing Swedish economy. As there is also a flatter interest rate path, this indicates that future market interest rates will be at reasonable levels, which is good for car sales. Individually, the third quarter proved to be one of the most successful ever, with a quarterly profit of SEK 78 million. This year's accumulated profit was SEK 188 million, which is 20 % better than the previous year. The increase in profit is the result of somewhat higher margins and an adjustment of costs. Individually, the third quarter proved to be one of the most successful ever Lending volumes increased by SEK 0.4 billion (2 %) compared with the previous year, mainly due to the continuous increase in vehicle sales of both cars and trucks. In addition, second-hand sales at Volvo dealerships have regained momentum after a period of lower volumes. The credit card business has grown by 2 % over the previous year. Credit losses continue, as expected, to remain at a low level and, as was previously the case, only concern card portfolios. As previously, the financing of vehicles shows no losses, which proves that our business model with the Swedish Volvo dealerships works well even in tougher times. Nor has there been any significant increase in the Volvo dealerships' own credit losses during the year. The Swedish Volvo dealerships' overall operating profit for the whole of 2009 increased by just over SEK 500 million and has now returned to a normal level. Volvofinans Bank is the financial services provider for the Swedish Volvo dealership network. Car sales can, therefore, continue to work in a satisfactory manner, even during tougher times. This has had a major impact for Volvo Cars, Volvo Trucks and the Swedish Volvo dealerships (for both passenger vehicles and trucks). Deposits from the public continue to increase and amounted to SEK 2.4 billion, an increase of SEK 0.6 billion, which is the highest ever level. Volvofinans Bank, with its strong capital base of SEK 3.0 billion and a core capital ratio of 14 %, is well equipped to meet future challenges. The historically solid business model, together with Volvo dealerships, the close cooperation with Volvo Cars, Volvo Trucks and Renault, the continuing very low credit losses in the card business, and higher deposit volumes from the public mean that we can look to a bright future. The information contained in this report is that which Volvofinans Bank AB (publ), corporate ID no is obliged to publish in accordance with the Swedish Securities Market Act (SFS 2007:528). This report was submitted for publication at 8.00 a.m. on 17 November In the event of conflict in interpretation or differences between this annual report and the Swedish version, the latter will prevail. 2

3 FACTS ABOUT VOLVOFINANS BANK BUSINESS MISSION The primary task of Volvofinans Bank is to actively support sales of products marketed by Volvo dealers on the Swedish market by providing product and sales financing, while reporting favourable earnings. MARKET ACTIVITIES The aim of providing our customers with economical, convenient vehicle ownership is reflected in the products we offer: Loans and leasing of new and used vehicles that are sold by Swedish Volvo dealerships. Loans and leasing for the truck market. Volvo Card car ownership card for both companies and private individuals. Vehicle fleet administration and financing for large vehicle fleets. Volvo Truck Card simplifying cost management for hauliers. Personnel car a simple way of offering employees a company car solution. Private loan a loan product for the purchase of used vehicles outside dealerships. Savings account with attractive interest and free withdrawals. 3

4 Ownership situation Since its establishment in 1959, Volvofinans Bank has been 50 % owned by Swedish Volvo dealerships via their holding company, AB Volverkinvest. The Sixth Swedish National Pension Fund (AP-fonden) owns 40 % and Volvo Car Corporation (Volvo Personvagnar AB) 10 %. The primary task of Volvofinans Bank is to actively support sales of products marketed by Volvo dealers on the Swedish market by providing product and sales financing, while reporting favourable earnings. Volvofinans Bank AB is the parent company of a Group with dormant subsidiaries. AB Volverkinvest 50 % The Swedish Volvo dealers 40 % Sixth Swedish National Pension Fund volvofinans bank ab 10 % Volumes/lending Sales of new passenger cars in Sweden rose by 36 % compared with the same period in the previous year. In total passenger vehicles were registered ( ). The number of Volvo, Renault and Ford registrations was 59,432 (44,224), and their combined market shares was 29 % (29). 43 % (43) of all passenger car business, new and used, within the Swedish Volvo dealerships generates a financial contract with Volvofinans Bank. New and used vehicle penetration is 46 % and 39 % respectively. Volvofinans Bank finances the Swedish Volvo dealers' truck sales, apart from those that take place through the AB Volvo-owned Volvo Truck Centre. Penetration for new trucks was 48 % (52). The total contract portfolio (loan and leasing contracts) amounted to 188,831 contracts (185,339). The truck and bus element of the contract portfolio amounted to 8,234 contracts (8,447) which represents more than 4 % of the total. The number of corporate customers for whom Svensk Vagnparksfinans manages the car administration remains stable. Administration with cost follow-up was being provided for (31 838) cars at the end of the reporting period. Goods and services purchased using the Volvo Card totalled about SEK 8 billion and the number of active accounts is half a million per month. Goods and services to a value of SEK 382 million were purchased using the 23,000 Volvo dealerships' Truck Cards. The accumulated profit for the year is 20 % better than last year The Group's lending volume was SEK 22,5 billion compared with SEK 22,1 billion in the previous year. The truck and bus share of lending was SEK 3,5 billion (3,7), which corresponds to 16 % of total lending. The Group's primary segments are the business lines of the passenger car market and truck market. The geographic distribution reflects the Group as a whole. The passenger car market segment includes financing for passenger cars through loans and leases, vehicle administration and the Volvo Card. The truck market segment includes financing for trucks and buses as well as the Volvo Truck Card. The operating income, operating profit, number of contracts and lending volume for Volvofinans Bank's lines of business are presented below. Operating income is defined as the net of interest income, interest expenses, leasing net, dividends received, net result of financial transactions, commission income and commission expenses. Jan-Sep 2010 Cars Trucks Group Assets, SEK million (average) 19,800 4,092 23,892 Lending volume, SEK million (average) 19,266 3,966 23,232 Operating revenue, SEK T 380,115 24, ,108* Operating profit, SEK T 175,170 12, ,502 Expenses, SEK T 193,690 12, ,731* Number of contracts (average) 210,198 8, ,488 * The amounts differ from the Group's operating income and expenses because the followup of segment performance occurs without any Group eliminations and reclassification of operational leasing assets to financial leasing assets. Expenses are defined as general administration expenses and other operating expenses. Volvofinans Bank is of the opinion that it is not relevant to divide up its liabilities among the various segments. Borrowing is determined by the total requirement and cannot be attributed to a specific segment. Income Volvofinans Bank's income before credit loss expenses is SEK million (166.2). Primarily due to improved earnings on higher margins and lower costs. Income before appropriations and taxes for the period increased by 20 % to SEK million (156.0). CREDIT RISKS AND CREDIT LOSSES The Group's credit risk continues to be very low as most of the credit risk and residual value risk is borne by the Volvo dealers. Problem credits are all receivables that are overdue by more than 90 days. Volvofinans Bank's problem credits for credit card receivables total SEK million (127.8) and, for loan and lease lending, SEK million (156.6). The decrease in problem credits with regard to loans and leases can be attributed to improved business conditions and the majority, million, of these are dealer credit risk through recourse agreements Number of contracts Average contract, SEK T Collateral value, SEK million Drawn credit, SEK million Loan to value ratio Market value, SEK million Surplus, SEK million Surplus, per cent Loans 114, ,228 10, % 17,116 6, % Leases 74, ,162 9, % 10,947 1, % Total 188, ,390 19, % 28,063 8, % 4

5 There are no loans for which interest concessions have been agreed and no property has been received to provide security for receivables. The credit losses incurred refer to credit card transactions. Anticipated credit loss impairment for the household segment is determined using statistical risk models and for the corporate segment by means of a manual review. Amounts in SEK T Group Parent Company Confirmed credit losses Confirmed credit losses -12,348-8,688-12,348-8,688 Recovered losses Total -12,292-8,601-12,292-8,601 Provisions for credit risk Reserve for anticipated credit losses 417-1, ,531 Credit losses, net -11,875-10,132-11,875-10,132 CAPITAL PROCUREMENT After frequent periods of financial concern during the first six months, the third quarter ended in a more stable period with a greater risk appetite on the market. Volvofinans Bank has successfully borrowed both short and long-term on the market through the bank's commercial paper and MTN programmes respectively. The total outstanding financing from capital markets amounted to SEK 12.5 billion at the end of the quarter. In addition to market borrowing, operations were financed to the amount of SEK 4.1 billion in the form of bank loans, as well as customer deposits of SEK 2.4 billion at the end of the period. At year-end, 61 % of long-term financing had a remaining term of more than one year. Rating Volvofinans Bank has international credit ratings from Moody s Investors Service as follows: Short-term financing: P-2 Long-term financing: Baa2 Moody s analysis is available for viewing on our website, FINANCIAL RISKS As the company operates within the financial sector, the company is continuously exposed to a number of financial risks. Liquidity risk is the risk that Volvofinans Bank's payment obligations will not be able to be met on maturity without the cost of the means of payment increasing considerably or, in the worst-case scenario, not being able to be met by any means. For shorter periods of liquidity instability, Volvofinans Bank has a daily surplus liquidity of SEK million. In order to secure its ability to pay, Volvofinans Bank has entered into agreements with banks concerning credit facilities that can be utilised at short notice. Borrowing with a remaining period of less than one year must be covered at all times by undrawn credit facilities. The total volume of available facilities at the end of the quarter was SEK 9.6 billion. Interest rate risk is the current and future risk that net interest income declines as a result of unfavourable changes in the interest rate. The vast majority of Volvofinans Bank's lending and all borrowing follow the short-term market interest rate, which involves a limited interest rate risk. Currency risk is the risk of unfavourable changes in exchange rates. All of Volvofinans Bank's lending is in Swedish kronor and any borrowing in foreign currency is hedged, thus Volvofinans Bank is not exposed to fluctuations in exchange rates. CAPITAL ADEQUACY Capital adequacy means that capital requirements are connected to the total risk profile of the institute, which, in the case of Volvofinans Bank, entails a lower minimum capital requirement. Volvofinans Bank calculates the capital requirement for credit risk using the standardised method, which means that all exposures are allocated to one of fifteen exposure categories with a different risk weighting for each category. The capital requirement for operational risk is calculated using the base indicator method, which means that the capital requirement is 15 % of the average operating income for the last three financial years. EVENTS AFTER THE BALANCE SHEET DATE No significant events have occurred since the end of the reporting period. Bert Björn President Volvofinans Bank AB The report for 31 December will be published on 21 February 2011 and will be available from our website: If you have any questions, please contact our President, Bert Björn, on +46 (0) This report has not been the subject of special examination by the company's auditors. 5

Interim Report 1 January 31 March Volvofinans Bank AB Message from the President January March highlights Pre-tax profit SEK 75.7 million (58.7) Return on equity 7.5% (5.8) Lending at 31 March of SEK 23.9

INTERIM REPORT 1 JANUARY - 30 JUNE 2011 VOLVOFINANS BANK AB Message from the President The second quarter of 2011 was characterised globally by the financial crises in a number of European countries, particularly

Year-End Report volvofinans bank ab Message from the President In 2010, the Swedish economy grew stronger with each passing month, while many countries in Europe were struggling with weak economies and

23 April 2015 Scania Interim Report, January March 2015 Summary of the first three months of 2015 Operating income decreased by 1 percent to SEK 2,245 m. (2,257) Net sales rose by 6 percent to SEK 22,321

Interim Report Interim Report Sales in the quarter increased to SEK 225.1 (216.9) million. In local currencies the decrease was 1.1 per cent. Operating profit for the quarter was SEK 12.9 (5.7) million.

28 January, 2002 SCANIA YEAR-END REPORT JANUARY - DECEMBER 2001 After the unsatisfactory 2001, our measures to adjust production to lower global demand, structural changes related to cab production and

Appendix 1 SEB Trygg Liv SEB Trygg Liv represents the SEB Group s life insurance business according to a bank-assurance concept, i.e. an integrated banking and insurance business. The purpose of the concept

Appendix 1 SEB Trygg Liv SEB Trygg Liv represents the SEB Group s life insurance business according to a bank-assurance concept, i.e. an integrated banking and insurance business. The purpose of the concept

Year-end report -12 Results for the full year Business volume increased by 7 percent to bnsek 41.8 (38.9). Lending, including leasing, increased by 11 percent to bnsek 22.0 (19.8). Deposits increased by

26 October 2005 Summary of Non-consolidated Financial Statements for the First Half of the Financial Year Ending 31 March 2006 Listed company s name: Shinko Securities Co., Ltd. Listing stock exchanges:

Broström is one of the leading logistics companies for the oil and chemical industry, focusing on industrial product and chemical tanker shipping and marine services. Broström is based all over the world

November 8, 2011 Overview of Business Results for the 2nd Quarter of Fiscal Year Ending March 31, 2012 () Name of the company: Iwatani Corporation Share traded: TSE, OSE, and NSE first sections Company

PRESIDENT AND CEO ERIK STRAND S COMMENTS ON INTERIM REPORT FOR JANUARY 1 SEPTEMBER 30, 2004 Press information, November 8 Poolia AB The Poolia Group s operating result remained positive during the third

Appendix 1 SEB Trygg Liv SEB Trygg Liv represents the SEB Group s life insurance business according to a bank-assurance concept, i.e. an integrated banking and insurance business. The purpose of the concept

Interim Report January 1 June 30, 2005 Industrivärden s net asset value was SEK 41,171 M on August 2, 2005, compared with SEK 36,563 M at the start of the year, entailing an increase of SEK 4,608 M for

Ford Motor Credit Company QUARTERLY REPORT ON FORM 10-Q for the quarter ended June 30, 2005 Filed pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 (Mark One) [X] UNITED STATES SECURITIES

Management s Review Principal activities Arla Foods amba and its subsidiary enterprises operate dairy activities based on milk weighed in by its members in Denmark, Sweden, Germany and now also the United

Translation Notice: This document is an excerpt translation of the original Japanese document and is only for reference purposes. In the event of any discrepancy between this translated document and the

Interim report for the first quarter of the financial year 2008/2009 Increasing market share in a receding market First quarter (September November 2008) KappAhl s net sales (excluding VAT) for the period

Acal plc Accounting policies March 2006 Basis of preparation The consolidated financial statements of Acal plc and all its subsidiaries have been prepared in accordance with International Financial Reporting

Nitta Corporation and Subsidiaries Notes to Consolidated Financial Statements March 31, 1. Basis of Preparation The accompanying consolidated financial statements of Nitta Corporation (the Company ) and

7 May 2014 HSBC BANK CANADA FIRST QUARTER 2014 RESULTS Profit before income tax expense for the quarter ended 2014 was C$233m, a decrease of 13.4% compared with the same period in and broadly unchanged

The Board of Directors and the Managing Director of Modity Energy Trading AB submit the following Annual report for the financial year January 1 - December 31 2012 Table of contents page Administration

Company Announcement The following is a Company Announcement by Lombard Bank Malta p.l.c. pursuant to Malta Financial Services Authority Listing Rules: Quote The Board of Directors of Lombard Bank Malta

/08 9-MONTHS REPORT Stable development of business in Q3 Lila Logistik confirms full-year forecast Key figures for the first three quarters of 2008 in accordance with IFRS 01.01. 01.01. Change in Change

BONG LJUNGDAHL AB Interim report January - June 2005 Bong continued its positive earnings trend in the second quarter of 2005 with a profit before tax of SEK 9 (-3 P 1) ) million. For the first six months

Interim Report for the period 1 January 31 March 2015 ALL FIGURES IN THIS REPORT ARE EXPRESSED IN SEK, UNLESS STATED OTHERWISE. FIGURES IN PARENTHESES REFER TO THE CORRESPONDING FIGURES FOR THE PREVIOUS

Interim report April-June 2003 Pre-tax profit for the second quarter amounted to SEK -34m, which is a SEK 30m improvement compared to last year (SEK -64m). Software revenue grew by 5% during the second

This English version is a translation of the original Japanese document and is only for reference purposes. In the case where any differences occur between the English version and the original Japanese

Länsförsäkringar Bank INTERIM REPORT JANUARY JUNE 2003 Summary Lending to the general public rose 58% to SEK 25.3 billion (16.0) and deposits from the general public increased 24% to SEK 16.6 billion (13.4).

gjensidige.com Interim report second quarter and first half of 2010 gjensidige bank boligkreditt as INTERIM REPORT FOR second Quarter AND first Half 2010 Gjensidige Bank boligkreditt OPERATIONS Gjensidige

Note 1 to the financial information Basis of accounting ITE Group Plc is a UK listed company and together with its subsidiary operations is hereafter referred to as the Company. The Company is required

Indian Accounting Standard (Ind AS) 21 The Effects of Changes in Foreign Exchange Rates (This Indian Accounting Standard includes paragraphs set in bold type and plain type, which have equal authority.

International Accounting Standard 7 Statement of cash flows * Objective Information about the cash flows of an entity is useful in providing users of financial statements with a basis to assess the ability

Financial statements of ČEZ, a. s. as of December 31, 2013 In terms of Section 19a of the Accounting Act, the financial statements of ČEZ, a. s. as of December 31, 2013 were compiled in accordance with

INTERIM FINANCIAL STATEMENTS FOR THE THIRD QUARTER ENDED SEPTEMBER 30, (UNAUDITED AND EXPRESSED IN CANADIAN DOLLARS) NOTICE TO READER Under National Instrument 51-102, Part 4, subsection 4.3(3) (a), if

Condensed Interim Consolidated Financial Statements Unaudited (Expressed in Canadian dollars) NOTICE TO READER: These condensed interim consolidated financial statements have not been reviewed by the Company's

CONSOLIDATED FINANCIAL REPORT FIRST QUARTER FISCAL 2009 (March 1, 2009 to May 31, 2009) July 9, 2009 F&A Aqua Holdings, Inc. is listed on the First Section of the Tokyo Stock Exchange under the securities